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Renting Water Heaters In Ontario

It's been a while since I posted anything on this forum, but I often peruse it for info.

This post is meant to be sort of an "info post", in hopes that others will stumble upon it and realise they've been hoodwinked by the Great Water Heater Rental Scam.

I live in Ontario, Canada, and the water heater rental business is, to say the least, brisk here. According to Reliance Home Comfort, 1.2 million homeowners rent water heaters here. And that's only their part of the pie, Wow. What a cash cow. You know its got to be a huge money maker when organisations like The Ontario Teachers Pension Fund get involved.

I'm not sure how the rental business evolved here. Other parts of the country seem to be less affected by this blatant money grab. One theory is, local utilities, in an attempt at conservation, (natural gas vs. electric), offered rental units to homeowners as a way to conserve, and offset the cost of a new install by offering a rental program. Many of them had a pay-to-own option. Another theory is that new home builders could drop their price slightly by including a rental w/h unit in their homes.
Then, at some point, a bean counter realised this was a huge profit centre. Thus the scam began.

Let's do the numbers. Even a poorly maintained W/H will last 8-12 years. For example, a new power vent water heater costs about $900. The current rental rate from Reliance, one of the many companies offering rentals, is $25 per month, as of January 2012. Do the math. Where else, in this economy, can you double your investment in six years.

Some background on my situation: We moved into our house 4 1/2 years ago, and, at the time, had a number of large expenses, and typically, didn't want to shell out for a water heater.
After reading about some companies allowing customers a buy out option, I contacted Reliance and was told that the buy out would be $800. I almost choked. "$800 for a six year old tank?" "Well", the man said, "It's a heavy duty tank, you know. We can't just rent out ordinary tanks. These are special." I asked if he thought I fell off a turnip truck the previous night, and told him I'd get back to him on the details in regards to the removal process.
Weeks turned into months, and I ignored that bloody rental water heater, that money vacuum in my basement, as much as I could. A home mortgage is one thing, but getting it in the ear for a friggin' home appliance was another. I'm not renting my stove, my dish washer, nor my fridge...Grrr...

Finally, it was Reliance's rate increase, starting January 2012, that broke the camel's back.

I found someone on Kijiji that was selling a used power vent tank, and I offered buddy $50 for it. When I got it home and started doing the 'requisite check up', I found that the anode was mostly gone, and the dip tube had rotted off and fallen into the tank. I managed to fish all the plastic tubing bits out, and replaced the leaking drain valve. I also cleaned out as much of the sediment as possible.

Today I pulled out the Reliance rental unit, and installed my refurb. After mucking with the vacuum switch tube, which had gotten knocked off in transit, it fired up no problem. I will now buy a new anode for it, now that I know that it's working properly.

Now, I'm not suggesting that people currently renting a water heater go hunt down a used unit as I did, but simply GO BUY A NEW ONE, THEN LOOK AFTER IT. Don't get shafted by these rental companies, and definitely DO NOT sign a long term rental contract.

I have talked to many people this past while, who have rental units. There seem to be many misconceptions about water heaters. For example:

i) They are VERY expensive to buy.
Uh.,.what? Most cost less than that plasma TV you recently purchased. And probably will last longer too, if you maintain it. Now, a new hot water heater isn't nearly as sexy as a new 55" TV, but I guarantee, after five days of abstinence from both, and a choice was offered between the two, priorities would become crystal clear.... I digress.
ii) They are expensive to service, and the Rental Company pays for the service.
Again,..Uh, duh, what ? No, YOU are paying for the service. You just don't want to acknowledge it. Think about it. Even if you hired a plumber annually for $80 to inspect the water heater you own, you'd still be coming out ahead.
iii) The Rental Company will insure against damages caused by their tank leaking.
Are you kidding?? They cover nothing aside from keeping the tank limping along. You had better make sure your insurance policy is updated and includes water damage.

As a final note, my 'Reliance Notice Of Rate Increase' states some lovely double-speak gems such as:

"Free replacement should it be un-repairable as a result of normal use"
Really? You mean it if it pisses water all over my possessions and causes thousands of dollars in damages because you don't maintain your water heaters in any way, shape, or form, you are still willing to give me a new water heater? How charitable.

"Guaranteed service - our large network of qualified, licensed technicians provided gauranteed support."
Now that's a doubly-duty gaurantee, if I ever read one. Whatever it means.

"All repair, parts, and labour, as a result of normal use, are included through the life of the equipment".
Once more, uh, duh... It's a rental, NOT a lease. It's their equipment. If you rent a house, do you need to pay to have it re-shingled?

As a final insult, the Reliance letter states that "1.2 million homeowners...trust us...and why we've saved our customers over $80 million on water heater repairs last year alone."

Holy Crap! $80 million dollars! It costs $80 million dollars to repair a water heater!
I want to save $80 million dollars! I want to rent one now! I'm going to save enough for me, my wife, and my child's retirement just by renting from your company!
Not.

I just called Reliance Home Comfort, the company which has been renting me the water heater. It turns out that they have a $40 contract cancellation fee, and want me pay and additional $65 to pick up their tank unless I drop it off at their depot. I got a bit angry, and told the CSR that they could pick it up, or i'd call a scrap guy to take it away. She said I'd be charged $730, the "buy out price" for the tank if I did that. I told her, "It's a 2004 model, how in the hell is it worth that much? I can go buy a new one for $900", to which she replied the same old "These are Special Heavy Duty models, build just for Reliance"
Ya right.
So now I need to somehow get that friggin' tank back to them in my Ford Focus. I told the CSR that Reliance Home Comfort just bought $105 of serious bad publicity.

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Yup - I live in Ontario also. I bought my tank many years ago. Renting is a total scam, but people who buy new builds just take the easiest route. The builders don't want to pay for a HWH, so they have an agreement with the gas companies to place rental units in new builds.

When I bought my first home, there was a rental HWH in the house. I called with a question about it (not a technical question either), and they basically told me they didn't know the answer and I shouldn't worry about it. Great service huh?

I visited my aunty in prescott and my grandparents in brighten two years ago and was shocked to hear that they rentes thèse poorly istalled dinosaur tanks and told them that it sounded like ?* scam... You just reminded me i think i might give them ?* Call... Thanks for thé reminder theirs were gsw or John woods If i remember correctly.

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I visited my aunty in prescott and my grandparents in brighten two years ago and was shocked to hear that they rentes thèse poorly istalled dinosaur tanks and told them that it sounded like ?* scam... .

It is a scam.
If you'd seen the sloppy solder joints on the 3/4" copper and the solvent mess all over the vent pipe on my installation, you'd swear it was done by a one armed blind guy. Zero pride in workmanship.

Damn, that reminds me; I should have taken some pictures! Why to I always think of the camera AFTER I've cleaned up messes like these? :/

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i wonder if i can start renting entry doors with special heavy duty door locks for $20 a month?

Oh ya baby, you sure can!

" A burglary occurs every three minutes in Canada! What can you do to avoid this? The answer is simple—a special heavy duty door lock with our patented pick resistant key, which makes you one-third less likely to fall victim to a burglary. That’s why more and more homeowners are turning to the solutions offered by the security system leader—Protectron."
"We also offer matching door knobs for your super heavy duty door lock and patented pick resistant key set, for only a small increase in your already low monthly payment. Why be just safe, when you can be both stylish and safe?"